The Chicago HIDTA region has one of the largest illicit drug user populations in the United States. According to the Illinois Department of Human Services Division of Alcoholism and Substance Abuse (DASA), the Chicago HIDTA region accounted for 53.6 percent of all treatment provider services rendered in Illinois in state fiscal year (SFY)f
2009. The consequences associated with the abuse of heroin and cocaine (both powder and crack) in the HIDTA region are considerably more severe than those associated with the abuse of any other drug. More treatment provider services were rendered for heroin (25,751) in the Chicago HIDTA region in SFY2009 than for any other substance of abuse, including cocaine (11,447), alcohol (15,884), and marijuana (12,366). These figures represent 79.9 percent of all heroin treatment provider services and 57.4 percent of all cocaine treatment provider services for the entire state that year. According to DASA, a reduction in treatment services rendered in SFY2009 was largely due to state funding cuts (which were restored after approximately 6 months) and not to significantly decreased drug abuse. These funding cuts limited the availability of publicly funded treatment services during this period, but the degree to which such services were requested and not provided is unknown. (See Figure 3.)

According to the Office of National Drug Control Policy (ONDCP) 2008 Arrestee Drug Abuse Monitoring (ADAM II) program, 87 percent of recently arrested adult males in Chicago (Cook County) tested positive for at least one drug, and 40 percent tested positive for multiple drugs--the highest percentages of all 10 test sites in the country. (See Table 2.) Of the arrestees in Chicago, marijuana (48.6 %) was the drug most commonly detected in urinalysis. A higher percentage of arrestees tested positive for cocaine (43.8%) and opiates, including heroin (28.6%), in Chicago than at any other test site in the country. Moreover, the percentage of arrestees who tested positive for opiates in Chicago increased from 2007 (20.2%) to 2008 (28.6%).

Hundreds of millions of dollars in drug proceeds are generated in the Chicago HIDTA region each year. Traffickers use bulk cash movement or laundering through various techniques such as money transmissions, structured deposits in traditional depository institutions, the Black Market Peso Exchange (BMPE), front companies, and real estate transactions to transport or conceal these funds.

Bulk cash smuggling is the primary method used by traffickers to move drug proceeds from Chicago. Bulk cash derived from illicit drug sales in the HIDTA region and in surrounding drug markets is typically transported to Chicago, where it is consolidated by Mexican DTOs for shipment to locations along the Southwest Border or to Mexico. In 2009, Chicago HIDTA initiatives reported the seizure of $18,355,000 in cash. Currency is usually concealed in hidden compartments in private vehicles or commercial tractor-trailers and, to a lesser extent, transported by couriers on trains and buses.

Traffickers in the HIDTA region often use money services businesses (MSBs) and bank services such as wire remittances, automated teller machines (ATMs), and Internet banking to move and launder drug money. Traditional bank accounts are also used by drug traffickers to launder illicit funds; traffickers typically deposit drug proceeds in Chicago HIDTA region banks and have associates in other states or countries withdraw the funds from the account using ATMs. For example, some Mexican traffickers structure cash deposits into bank accounts in Chicago and withdraw the money from ATMs and banks in California, later smuggling it into Mexico. Various MSBs also offer traveler's checks, money orders, and stored value cards, which traffickers use to launder money. Money order purchases under $3,000 do not require identification, a circumstance that is exploited by traffickers who purchase money orders at multiple locations in amounts under the reporting threshold. The money orders are then sent by courier or package delivery service to other locations (domestic and foreign) for deposit in financial institutions.

Colombian traffickers in the HIDTA region use the BMPE to launder
millions of dollars in drug proceeds annually. In this system,
Colombian traffickers receive Colombian pesos in Colombia in
exchange for U.S. drug dollars located in the United States. Brokers
then sell the U.S. dollars located in the United States at a
discount to Colombian merchants, who use the funds to purchase U.S.
goods.

Retail-level distributors, primarily gang members, operate
businesses and engage in mortgage fraud schemes to launder drug
proceeds. They often use cash-based businesses such as beauty
salons, car washes, and used car lots to commingle drug proceeds
with legitimate business revenue. Local distributors also employ
mortgage fraud schemes that involve straw purchasers and
unscrupulous mortgage brokers and appraisers to purchase property at
a minimal cost and sell it at a higher value to a third party.
Additionally, some distributors purchase and refurbish properties to
seemingly legitimize their illicit drug proceeds. Local distributors
also use drug proceeds to purchase luxury vehicles and jewelry.